Deutsche Bank AG is launching a new investment manager targeting private credit opportunities on behalf of institutional clients and high net worth investors.
(Bloomberg) — Deutsche Bank AG is launching a new investment manager targeting private credit opportunities on behalf of institutional clients and high net worth investors.
DB Investment Partners (DBIP) will invest in corporate, real estate, asset-based, infrastructure and renewable finance lending opportunities, among other private debt strategies, according to a statement from the bank on Tuesday.
Other banks have bet on private credit this year, including JPMorgan Chase & Co., which invests from its balance sheet, and Societe Generale SA, which has plans to raise a €10 billion ($10.7 billion) fund alongside Brookfield Asset Management Ltd. Barclays has also earmarked some of its own cash to hold corporate loans and compete directly with private credit funds.
The push into this asset class from banks, along with other new entrants such as Fidelity International and Ninety One PLC, has seen the industry swell in size to $1.5 trillion.
With the new venture, Deutsche Bank is making a foray into raising outside money for private credit. Among the large global banks, Goldman Sachs Group Inc. has succeeded in having a substantial presence in private credit lending via its asset management business, and often competes to participate in billion-dollar deals.Â
While some banks have set aside sums to lend through their own balance sheets, regulatory constraints make it challenging. There are stiff capital charges for holding loans for buyouts and highly levered companies.
Dealflow Benefits
The German banking giant already invests in private debt through its balance sheet, but DBIP will operate independently of that business, the statement said. The bank does expect the new investment manager to benefit from dealflow generated through Deutsche Bank’s existing lending arms.
Raheman Meghji, previously a Deutsche Bank managing director, will be chief executive officer of the new firm, while Jon Aisbitt will be chair. Aisbitt has formerly acted as the chairman for Pension Insurance Corp. Group Ltd. and Man Group PLC.
Bloomberg News reported last June that Deutsche Bank planned to raise around €2 billion for a range of different credit strategies.Â
(A previous version was corrected to remove a reference to retail investors as potential clients for new asset manager)
–With assistance from Silas Brown.
(Corrects to remove reference to retail investors)
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